ACAP VS.
CA  Acap refused to pay any further lease rentals
FACTS:
The title to Lot No. 1130
OCT No. R-12179.
Area: 13,720 sq. meters.
The title was issued and is registered in the name of
spouses Santiago Vasquez and Lorenza Oruma. After
both spouses died, their only son Felixberto inherited
the lot.
IN 1975
 Felixberto executed a duly notarized document
entitled "Declaration of Heirship and Deed of
Absolute Sale" in favor of Cosme Pido. The
evidence before the court a quo established
that since 1960, petitioner Teodoro Acap had
been the tenant of a portion of the said land,
covering an area of nine thousand five hundred
(9,500) meters.
 When ownership was transferred by Felixberto
to Cosme Pido, Acap continued to be the
registered tenant thereof and religiously paid
his leasehold rentals to Pido and thereafter,
upon Pido's death, to his widow Laurenciana.
NOVEMBER 27, 1981
 Pido died intestate. His surviving heirs
executed a notarized document denominated
as "Declaration of Heirship and Waiver of
Rights of Lot No. 1130 Hinigaran Cadastre,"
wherein they declared he was survived by his
heirs, namely: LAURENCIANA PIDO, wife,
ELY, ERVIN, ELMER, and ELECHOR all
surnamed PIDO;
 The heirs declared that they adjudicate the
parcel of land in equal shares, waive, quitclaim
all their rights, interests and participation over
the said parcel of land in favor of EDY DE LOS
REYES.
 The document was signed by all of Pido's heirs.
Private respondent Edy de los Reyes did not
sign said document.
At the time of Cosme Pido's death, title to the
property continued to be registered in the name of the
Vasquez spouses.
Edy de los Reyes filed with the Registry of Deeds
as part of a notice of an adverse claim against the
original certificate of title the Declaration of Heirship
with Waiver of Rights in his favor, private respondent
the same
Edy sought for Acap to personally inform him that
he had become the new owner of the land and that the
lease rentals thereon should be paid to him. He further
alleged that he and petitioner entered into an ORAL
LEASE AGREEMENT wherein petitioner agreed to
pay ten (10) cavans of palay per annum as lease
rental.
IN 1982
 Acap allegedly complied with said obligation.
IN 1983
on the land, prompting Edy to seek the
assistance of the then Ministry of Agrarian
Reform (MAR) in Hinigaran, Negros
Occidental. The MAR invited petitioner to a
conference scheduled on 13 October 1983.
Petitioner did not attend the conference but
sent his wife instead to the conference. During
the meeting, an officer of the Ministry informed
Acap's wife about private respondent's
ownership of the said land but she stated that
she and her husband (Teodoro) did not
recognize private respondent's claim of
ownership over the land.
On 28 April 1988, after the lapse of four (4) years,
private respondent filed a complaint for recovery of
possession and damages against petitioner, alleging in
the main that as his leasehold tenant, petitioner
refused and failed to pay the agreed annual rental of
ten (10) cavans of palay despite repeated demands.
During the trial before the court a quo, petitioner
reiterated his refusal to recognize private respondent's
ownership over the subject land. He averred that he
continues to recognize Cosme Pido as the owner of the
said land, and having been a registered tenant therein
since 1960, he never reneged on his rental obligations.
When Pido died, he continued to pay rentals to Pido's
widow. When the latter left for abroad, she instructed
him to stay in the landholding and to pay
the accumulated rentals upon her demand or return
from abroad.
Petitioner further claimed before the trial court that he
had no knowledge about any transfer or sale of the lot
to private respondent in 1981 and even the following
year after Laurenciana's departure for abroad. He
denied having entered into a verbal lease tenancy
contract with private respondent and that assuming
that the said lot was indeed sold to private respondent
without his knowledge, R.A. 3844, as amended, grants
him the right to redeem the same at a reasonable price.
Petitioner also bewailed private respondent's
ejectment action as a violation of his right to security of
tenure under P.D. 27.
On 20 August 1991, the lower court rendered a
decision in favor of private respondent, the dispositive
part of which reads:
WHEREFORE, premises considered,
the Court renders judgment in favor of
the plaintiff, Edy de los Reyes, and
against the defendant, Teodoro Acap,
ordering the following, to wit:
1. Declaring forfeiture of defendant's
preferred right to issuance of a
Certificate of Land Transfer under
Presidential Decree No. 27 and his
farmholdings;
2. Ordering the defendant Teodoro
Acap to deliver possession of said farm
to plaintiff, and;
3. Ordering the defendant to pay
P5,000.00 as attorney's fees, the sum
of P1,000.00 as expenses of litigation
and the amount of P10,000.00 as
actual damages.5
In arriving at the above-mentioned judgment, the trial
court stated that the evidence had established that the
subject land was "sold" by the heirs of Cosme Pido to
private respondent. This is clear from the following
disquisitions contained in the trial court's six (6) page
decision:
 There is no doubt that defendant is a
registered tenant of Cosme Pido.
However, when the latter died their
tenancy relations changed since
ownership of said land was passed on
to his heirs who, by executing a Deed
of Sale, which defendant admitted in
his affidavit, likewise passed on their
ownership of Lot 1130 to herein plaintiff
(private respondent). As owner hereof,
plaintiff has the right to demand
payment of rental and the tenant is
obligated to pay rentals due from the
time demand is made. . . .6
xxx xxx xxx
Certainly, the sale of the Pido family of
Lot 1130 to herein plaintiff does not of
itself extinguish the relationship. There
was only a change of the personality of
the lessor in the person of herein
plaintiff Edy de los Reyes who being
the purchaser or transferee, assumes
the rights and obligations of the former
landowner to the tenant Teodoro Acap,
herein defendant.7
Aggrieved, petitioner appealed to the Court of Appeals,
imputing error to the lower court when it ruled that
private respondent acquired ownership of Lot No. 1130
and that he, as tenant, should pay rentals to private
respondent and that failing to pay the same from 1983
to 1987, his right to a certificate of land transfer under
P.D. 27 was deemed forfeited.